Canada’s CPI inflation slows to over 3-year low

Annual headline consumer inflation in Canada has eased to 2.5% in July from 2.7% in June, the latest data by Statistics Canada showed.

The CPI reading came in line with market consensus and also marked the lowest inflation rate since March 2021.

The latest reading also came in line with the Bank of Canada’s projections that inflation would slow to the 2.5% level in the second half of 2024.

In July, inflation eased for shelter, to 5.7% YoY from 6.2% YoY in June, amid a broad drop in electricity costs, mortgage rates and rent.

Food inflation also slowed in July, to 2.7% from 2.8% in June.

Meanwhile, inflation remained stable for transportation, at 2%.

Annual core consumer inflation in Canada also eased in July, to 1.7%, from 1.9% in June, while adding to dovish Bank of Canada expectations.

In month-over-month terms, consumer prices in the country went up 0.4% in July.

The Canadian Dollar was little changed on the day against its US counterpart, with the USD/CAD currency pair last trading at 1.3612.

The major Forex pair was hovering above a fresh 6-week low of 1.3604.